Shopify Plus

If your store is on Shopify Plus, then you can activate Avalara AvaTax in your Shopify admin to charge taxes in your store using Avalara’s services instead of Shopify’s built-in tax engine. Avalara AvaTax also works for Shopify POS on Android and iOS devices.

You can use Avalara AvaTax to:

get accurate and up-to-date tax codes from more than 12,000 jurisdictions

fine-tune a set of tax rules to meet your business’s needs

create accurate reports of your business’s taxes

Limitations and known issues

The Avalara AvaTax app supports VAT but not VAT exemptions. You can use Avalara to calculate VAT taxes, but Avalara can't collect VAT IDs, which are required for exemption reporting and returns.

If you refund a dollar amount for an order without also selecting an item or restock quantity, then the refunded tax amount won't be applied to a specific item, and a return document won't be created in Avatax Console.

You need to set up your Shopify Tax settings, even when you use Avalara AvaTax. If Avalara is temporarily unavailable, then your Shopify tax rates are used to calculate the taxes for your orders.

Some third-party services can report to Avalara, resulting in duplicate order information. If you have a service that reports orders to Avalara, then you can change your settings to prevent Shopify from also reporting those orders. In your Shopify admin, go to Settings > Taxes, open your Avalara settings, and uncheck Send documents to AvaTax.